diff --git a/lib/compress.js b/lib/compress.js
index d890caf7..334efb24 100644
--- a/lib/compress.js
+++ b/lib/compress.js
@@ -4705,6 +4705,7 @@ merge(Compressor.prototype, {
                     value.walk(new TreeWalker(function(node) {
                         if (node instanceof AST_SymbolRef && node.definition() === defun_def) {
                             node.thedef = lambda_def;
+                            lambda_def.references.push(node);
                         }
                     }));
                 } else {
diff --git a/test/compress/drop-unused.js b/test/compress/drop-unused.js
index 90206ec6..1cc575b0 100644
--- a/test/compress/drop-unused.js
+++ b/test/compress/drop-unused.js
@@ -1434,3 +1434,28 @@ defun_lambda_same_name: {
     }
     expect_stdout: "120"
 }
+
+issue_2660: {
+    options = {
+        reduce_vars: true,
+        toplevel: true,
+        side_effects: true,
+        unused: true,
+    }
+    input: {
+        var a = 2;
+        function f(b) {
+            return b && f() || a--;
+        }
+        f(1);
+        console.log(a);
+    }
+    expect: {
+        var a = 2;
+        (function f(b) {
+            return b && f() || a--;
+        })(1);
+        console.log(a);
+    }
+    expect_stdout: "1"
+}